Why Everyone's Freaking out About Walmart's E-Commerce

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Watching the world of commerce flip upside down and inside out has been like waking up from a particularly realistic dream. You don’t know where the dream ends and real life begins.

But before I go all Matrix on you (too late), you should know that the e-commerce world is totally up in arms about Wal-Mart.

Wait! Aren’t they like this big box store chain? Why should the e-commerce world care?

But now is the absolutely perfect time for box stores to go “e.” People now do more of their shopping online than ever before.

They’re even buying their groceries online. Experts predict that online grocery shopping will reach $100 billion by 2025.

And WalMart already does it all. Why wouldn’t they tap into the online revolution?

But are they really a threat? Let’s take a look at why Walmart might actually be something you have to worry about.

1. The Google Problem

We all know what happens when someone powerful chooses sides. The powerful become even more powerful.

That’s what happened back in August when Google decided to back WalMart’s bid to go “e-Commerce.” But why would Google choose a box store over Amazon?

In some ways, Google isn’t an Amazon competitor. Their main product is search and pay per click ads. But Google does sell a lot of things that Amazon does.

Music, apps, movies, books, and the like are all cross-markets for both Amazon and Google. If Amazon goes the way of the Do-do, then more for Google.

And Google wants it all. Their Google Express shared storefront hasn’t been the forefront of e-commerce sales.

It used to be a subscription sales site. Google recently dropped the subscription requirement in advance of adding WalMart to the app/site.

Google stands to gain a lot from a strong WalMart e-commerce game. And WalMart has proven to be worthy of the title.

2. WalMart: Prince of e-Commerce?

The old physical location giant made bank this last quarter. Their stock earnings rose by more than 50%. And this has everything to do with their increased e-commerce efforts.

But besides teaming up with Google, what did WalMart do to actually start competing with Amazon?

While Amazon is just getting into the physical retail location game, WalMart has owned that territory for generations. And the marriage of e-commerce and traditional commerce is where it’s at.

People still want to touch objects and look at them before they buy them. And they want fast delivery if they decide to buy it online.

WalMart Knows How to Use Point of Purchase

WalMart is fulfilling both of these desires. With 11,000 stores, WalMart is almost everywhere. If you wanted to go see a product in person, you could just hop down to your local WalMart.

And while you might mean to shop around online after seeing the product, you’re not getting out of the store without the temptation to buy something else.

This is where Amazon will lose out until they can build enough retail locations.

Every e-commerce store owner should learn more about Point of Purchase tactics that physical retailers have been using for ages. While they won’t be able to fully compete, there are ways to use this tactic online.

Two-Day Shipping

Logistics is a beautiful but complicated industry. How companies like Amazon consistently hit the mark when it comes to shipping times is beyond me.

But it works. People now expect Amazon-like speed when buying online. I mean, I even paid extra at a small e-commerce site the other week just to get my package in two days.

While we still think of Amazon when we hear “two-day shipping,” WalMart is slowly changing that.

You can’t just buy anything on WalMart.com and have it at your door in two days. But, if you run your order above $35, you’ve got two-day shipping.

And when you’re buying your dog food and your cat little all in the same order, you quickly hit the free two-day shipping threshold. When my wife figured this out, it was over. Last week she bought all of our non-perishables on WalMart.com.

In-Store Pickup

This is something WalMart has done for a few years now. But it’s definitely something e-commerce stores cannot compete with.

If you see something on WalMart.com and it’s at your local WalMart, you can have it ready to pick up at the service desk within the day. While this does mean getting out of your house and driving, it does mean you’ll have your product almost immediately.

But again, this has been around for a while and can’t account for the growth WalMart has seen. But there is one other thing WalMart has that Amazon just can’t touch yet.

Groceries.

e-Commerce plus in-store pickup plus groceries equals extra revenue. Not all of WalMart’s locations offer a curbside pickup service. But I imagine all WalMart stores offering the service eventually.

Essentially, WalMart customers must buy at least $30 worth of groceries to qualify for curbside service. And once you’ve hit the $30 all you do is pay and drive down to your local WalMart.

They even load the groceries into your car.

Consumers will save time and WalMart will earn money and nobody in e-Commerce will be able to compete.

3. Is There Any Good News?

WalMart does work with the little guy, but it’s not as easy to sell on WalMart as it is on Amazon. It’s absolutely possible, though.

This means that as an e-commerce retailer, you can ride the WalMart wave if you want to.

If you can’t beat them, join them, right? And if you sell a competitive product, you could increase your overall revenue with your products on WalMart.com.

Should You Be Concerned?

Whether you should be concerned depends on your own flexibility. If you run an Amazon storefront, you might be freaking out at the moment. Customers might go to WalMart.com.

But if you do your research and adapt, you’ll continue to see growth.

If you’re interested in learning more about the e-commerce world, check out our other e-commerce blogs.

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